On February 18, 2026, the New Zealand dollar experienced a notable decline following the Reserve Bank of New Zealand's (RBNZ) decision to maintain its cash rate at 2.25%. The RBNZ indicated that its policy would likely remain accommodative for an extended period, which led to a 0.8% drop in the kiwi dollar, bringing it down to $0.6002. The bank projected that rates would average 2.4% in Q4 2026 and 2.5% in Q1 2027, which was less hawkish than market expectations. Shannon Nicoll, an associate economist at Moody's Analytics, stated, "We expect inflation to ease and the economy to gain enough momentum to support a gradual withdrawal of support around November," highlighting the cautious approach of the RBNZ amidst ongoing economic recovery concerns. Meanwhile, the Australian dollar also saw a slight decline, easing 0.2% to $0.7074, as the Reserve Bank of Australia (RBA) hinted at potential rate hikes in May if inflation remains stubbornly high.